Biz Bits: Five ways to save time and money on your taxes

Tuesday

Weekly business rail, with tax tips, BBB warning about rebates and more.

Tip of the Week

As people get ready to file their 2009 tax returns, there are a few things they can do to save time and money.

1. Make sure you're prepared. Having a few key items available when you start your taxes will save a lot of time. These include:

- Your tax return from 2008

- Social Security numbers for you, your spouse and children

- All W-2s (wage and tax withheld form for 2009 supplied by your employer), 1099s (statements on investment income provided by your financial services institutions), mortgage interest statements and other statements related to income

- All statements related to expenses that you will be claiming on your tax return

- The routing numbers and account numbers for the accounts in which you want to directly deposit your tax refund

2. Use an online tax program. One advantage of using an online tax program is that many of the items you need to start your taxes - like your prior year's return - can be stored by the program. So you don't have to waste time hunting down information every year. Online tax programs also are more accurate. In fact, the IRS reports that an electronically prepared and filed return has an error rate of less than 1 percent, compared with an error rate of about 20 percent for a paper prepared return.

3. Free file if you can. Depending upon how complicated a person's taxes are, they may be able to prepare and e-file their tax return for free. For example, if you don't need to itemize, and only have a few simple requirements - such as claiming the Earned Income Tax Credit - you may be able to use a free online tax program.

4. Maximize your credits and deductions. The average tax refund for 2008 was nearly $2,800. However, many taxpayers have the sinking feeling that they are not getting the tax breaks they should. In fact, according to an independent survey conducted by CompleteTax, two-thirds of 1,000 randomly surveyed taxpayers fear they may overlook tax breaks or make mistakes that could cost them in fines or penalties.

5. E-file and use direct deposit. Electronically filing and using direct deposit significantly increases how quickly taxpayers have access to their refund. Generally, e-filers can have their refund deposited directly into their accounts within a few days, compared to the weeks it takes to receive a mailed check. Certain tax programs also allow customers to split their refund and deposit it into three separate accounts. For example, you could deposit part in your checking account, part in your savings account and part directly into a tax-advantaged IRA account.

-- ARA

BBB Watch

Once the excitement of the holidays wears off, people turn to the promised rewards of mail-in rebates. However, the Better Business Bureau advises that it's more important than ever to read the fine print when filing for a rebate because retailers and manufacturers are changing the way they issue rebates.

According to CreditCards.com, retailers and manufacturers are increasingly opting to provide rebates in the form of pre-loaded cards as opposed to paper checks. Unlike checks, which can be deposited in a bank and used to pay bills, consumers must spend the rebate. These cards can often only be used where credit cards are accepted. In most cases, the cards can be used at any merchant - much like a debit card - but some retailers are also handing out rebate cards that can only be used at their stores. The cards may also have expiration dates and added fees that could whittle down their value.

"Rebates are a great way to get a deal, but they can also be a great source of frustration for consumers," said Steve J. Bernas of the Better Business Bureau. "By acting quickly to redeem the rebate and reading the mail-in instructions carefully, consumers can significantly reduce any disappointment associated with redeeming rebates."

For more tips, visit www.bbb.org.

The List

Here are the top 5 business deals of 2009, according to Time magazine:

1. Berkshire Hathaway–Goldman Sachs

2. JPMorgan Chase and the deals it didn't do

3. BB&T-Colonial

4. Berkshire Hathaway–Burlington Northern

5. Ford's $23.6 billion loan grab

For more details, go to www.time.com.

Number to Know

12.6: The big snowstorm that hit the East Coast on Super Saturday (the Saturday before Christmas) affected shopping – sales were down 12.6 percent from 2008, according to ShopperTrak.

GateHouse News Service

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